On October 9, the transportation segment is driving up the cost of delivered crude. According to an October 8 English-language report citing shipping data, the daily rate for Very Large Crude Carriers on the Gulf-to-East Asia route hit a record $1.4 million. In addition, a full-voyage quote on the US Gulf-to-Japan route reached $82 million, roughly half again higher than three weeks earlier, signaling that tension has spread to longer-haul routes.

In the view of OEXN, the issue is not just the volume of cargoes being loaded, but the efficiency of vessel turnover. A large number of tankers are tied up in ship-to-ship transfers and lightering operations, so even if export volumes recover, the number of ships available for deployment on other routes may not necessarily increase. Longer waiting times per vessel compress the number of voyages the same fleet can complete each month, making apparently ample capacity hard to deploy.

A shortage of large ships also pushes demand toward Suezmax and Aframax tankers, narrowing the room for buyers to cut costs by switching to smaller vessels. For refiners, what truly matters is the landed cost, not the crude benchmark price alone. Long-distance purchases may secure a lower cargo quote, but that advantage can be offset by higher freight and longer waiting times, in turn altering the competitiveness of crude from different origins. The term structure of freight contracts will also affect how quickly and how much costs are passed through.

OEXN judges that going forward, the number of available vessels, transfer times, and actual concluded freight rates can be tracked to test whether the high quotes can be sustained. Offers on individual voyages cannot represent all contracts, nor do they mean refiners have already absorbed an equivalent increase. Only when turnover improves and deliveries stabilize at the same time is shipping pressure likely to ease; otherwise, a recovery in supply may not quickly translate into lower end-user costs.